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Australia's largest bank accused of terrorism financing breaches

Staff Writer |
Australia's largest bank may face extensive fines after the country's financial intelligence and regulatory agency accused it of breaching anti-money laundering and counter-terrorism financing laws.

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The Australian Transactions Reports & Analysis Centre (AUSTRAC) has launched a civil case with the federal court that claims the Commonwealth Bank of Australia (CBA) did not adequately comply with the law from November 2012 to September 2015.

In total, AUSTRAC have alleged 53,700 contraventions of the Anti-Money Laundering and Counter Terrorism Financing Act over the three year period, with a value of around 624.70 million Australian dollars (494.82).

The financial watchdog also said the CBA's use of intelligent deposit machines (IDM), that instantly credit money to an assigned account domestically or internationally, had no limit or checks regarding the sum of money that could be deposited per day, which is in contrast with Australian regulations.

In Australia, authorities must be notified when a deposit of 10,000 Australian dollars ($7,021) cash is made to an account.

"CBA failed to give 53,506 threshold transaction reports to AUSTRAC on time for cash transactions of 10,000 Australian dollars (7,021) or more," AUSTRAC said.

"These late threshold transactions represent approximately 95 percent of the threshold transactions that occurred through the bank's IDMs."

Furthermore, AUSTRAC claims that even after CBA became aware of suspected money laundering amongst its accounts, the bank did not monitor the customers to mitigate the risk.

In response, the CBA said in a statement obtained by Xinhua, that they take their regulatory obligations "extremely seriously," and have invested more than 230 million Australian dollars ($182.24 million) to improve anti-money laundering and counter-terrorism financing compliance.

Each one of the 53,700 breaches holds a maximum 18 million Australian dollar ($14.26 million) fine.


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